Harvey Sawikin - Emerging Market Opportunities

**Patrick O'Shaughnessy** (0:00)
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Hello and welcome everyone. I'm Patrick O'Shaughnessy and this is Invest Like the Best. This show is an open-ended exploration of markets, ideas, methods, stories and of strategies that will help you better invest both your time and your money. You can learn more and stay up to date at investorfieldguide.com.

**SPEAKER_2** (0:59)
Patrick O'Shaughnessy is the CEO of O'Shaughnessy Asset Management. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of O'Shaughnessy Asset Management. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.
Clients of Oshanose Asset Management may maintain positions in the securities discussed in this podcast.

**Patrick O'Shaughnessy** (1:24)
My guest this week is Harvey Sawikin, a co-founder and lead portfolio manager at Firebird Management, which manages funds dedicated to investing in emerging market equities. Emerging markets are often a blind spot for investors of all types. Most of us have never traveled to the Far East or Eastern Europe where many of the thousands of emerging market public equities operate. I've been very lucky to travel quite a bit in Asia and the Middle East, but never to Eastern Europe, which is where Firebird focuses its investments. Harvey and I discussed his 24 years of experience evaluating emerging and frontier market countries, industries and individual stocks. We discussed his experience buying privatization vouchers in Russia, banks in the Baltics and how today's emerging market opportunity set compares to the past.
Like so many of these conversations with investors who have earned significant excess returns, it's clear investing opportunities in emerging markets are often disguised. Finding them requires risk, hard work, discipline and a dose of luck and timing. Please enjoy my conversation with Harvey on emerging market opportunities.
What is your single most memorable travel experience since the beginning of Firebird?

**Harvey Sawikin** (2:31)
Wow, that's really, that's a really tough question.
You know, I'd have to say my first trip to Russia in January of 1994, because it was like stepping into a John Le Carre novel. It was just grim, gray, dirty, smelly. And I went right in the dark of winter. And I stayed at the Moskva Hotel, which is now the Four Seasons at the time. It was just disgusting. And I went out.
They had a cafe. I couldn't eat. I couldn't find anything to eat. And the cafe, the food was inedible. There was some sort of thing, like some sort of jellied thing that looked, it was all inedible. I said, OK, there's got to be some restaurants around here. And I started walking.
And I couldn't find, in a freezing cold, I couldn't find any store with any food. The stores that were open had no food.
And there was nothing else open. And I said, I'm going to starve now. And I turned a corner and there was a McDonald's. The first, it was only the second McDonald's in Russia. And I've never, I think the only time I was so happy to go to a McDonald's was when I was probably seven years old and they opened the first McDonald's in New York up on the Upper West Side and went with my mom. And so God bless McDonald's. And for the first few times I went to Russia and then I discovered there were some other restaurants. I just didn't know where they were.
And on that same trip, we went to the voucher auction to buy privatization vouchers, which was held in an old Lenin post office, which had been turned into an exchange where they were trading like metals in the morning. And then in the afternoon, they were trading privatization vouchers. It was unheated. Guys were running around with fur hats, exchanging these packs of vouchers. I recall it like it was yesterday. And it had the smell of opportunity. Like people say to me sometimes, oh, when you started out in Russia, you took—was so risky, you took such a big risk. Why did you do that? And I would say, no, you don't understand. I was absolutely sure I was going to get rich. I had no doubt. I was so confident.